ONLY Part C

Consider a $300,000 loan that is fully amortizing over a 20- year period with an interest rate of 8%. a. Show that the more frequent the payments, the less interest that gets paid over the life of the loan. Use examples of annual payments, monthly payments, and weekly payments. Explain in one or two sentences why we observe this phenomenon. b. Assuming monthly payments, what is the outstanding balance on this loan after 5 years? c. Assume that at the end of 5 years, the borrower prepays $50,000 and the bank re-calculates the payment for the remaining balance over the remaining 15 year period. What would the new payment be